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Post by KostaAndreadis @ 03:01pm 26/06/17 | 10 Comments
Yesterday it came to light that Cloud Imperium Games took out a second Star Citizen loan in the UK, from the bank Coutts. What caused quite a bit of stir among those that have been following the development of both Star Ctizen and Squadron 42, was that terms of the loan made it sound like defaulting on a single payment would result in all IP ownership reverting to the bank.

In response to the news CIG took the time to explain the situation, and that the loan simply falls in line with a tax credit rebate that it gets.

Our UK companies are entitled to a Government Game tax credit rebate which we earn every month on the Squadron 42 development. These rebates are payable by the UK Government in the fall of the next following year when we file our tax returns.  Foundry 42 and its parent company Cloud Imperium Games UK Ltd. have elected to partner with Coutts, a highly regarded, very selective, and specialized UK banking institution, to obtain a regular advance against this rebate, which will allow us to avoid converting unnecessarily other currencies into GBP.  We obviously incur a significant part of our expenditures in GBP while our collections are mostly in USD and EUR.  Given today’s low interest rates versus the ongoing and uncertain currency fluctuations, this is simply a smart money management move, which we implemented upon recommendation of our financial advisors.


And that the collateral only refers to the UK-developed portion of the game -- Squadron 42.

Which, is fair enough. The troubling aspect that many saw as red flags coming from this revelation is that with over $150 million in crowdfunding being poured into Star Citizen, the last thing they'd want to see would be ownership shifting to a bank. Also, with development on the ambitious project now entering its sixth year, after first getting announced in 2012 the modular approach to its design and release so far has left many wondering when the final game will be made available.

And to answer the question posited by the headline -- no, probably not. But hey, we're still waiting patiently for any Star Citizen related release date news.



cloud imperium gamescigstar citizensquadron 42ukbank loanfinancial trouble





Latest Comments
Twisted
Posted 09:12am 27/6/17
Also, with development on the ambitious project now entering its sixth year, after first getting announced in 2012 the modular approach to its design and release so far has left many wondering when the final game will be made available.
I reckon more people have forgotten this game exists.
Ickus
Posted 10:38am 27/6/17
At least it shows they do have someone doing their financial planning who is smart enough to know why and how to select the cheaper option between a low interest loan and the cost of international money transfers with exchange rates.

As opposed to just pissing it up against a will like some kickstarters have done.
Raven
Posted 11:11am 27/6/17
At least it shows they do have someone doing their financial planning who is smart enough to know why and how to select the cheaper option between a low interest loan and the cost of international money transfers with exchange rates.


Don't be ridiculous. I have an honors degree in Computer Science and this is on the internet concerning a software company so of course I'm going to know more than some accountant or professional financial manager! /s
paveway
Posted 12:17pm 27/6/17
Good clickbait, very good clickbait.
Toxus
Posted 05:33pm 27/6/17
Always surprises me when people say a game is taking forever..does no one f*****g remember most games take around 8 years to produce something solid? We've all seen how short development ruins games... people just need a good backhand to wake up
trog
Posted 05:58pm 27/6/17
At least it shows they do have someone doing their financial planning who is smart enough to know why and how to select the cheaper option between a low interest loan and the cost of international money transfers with exchange rates.

As opposed to just pissing it up against a will like some kickstarters have done.
yeh it's kind of interesting. The pound has dropped 20% in the last year (most of it just after the Brexit vote). Borrowing pounds now while they're low to pay their UK expenses sounds good but if the pound goes back up (haha right?!) and all their money is in EUR, they're going to be on the hook for more. So I can only guess they've modelled this and figure that it's still the best option and that they assume the pound is going to stay relatively s***. Which seems to be the case given the way things are going. I would love to see this spreadsheet though!
fpot
Posted 06:24pm 27/6/17
I can't think of one game that's had an absurdly long development cycle and actually turned out to be good.

edit: Falcon 4 maybe but I never actually played it.
Khel
Posted 07:13pm 27/6/17
Always surprises me when people say a game is taking forever..does no one f*****g remember most games take around 8 years to produce something solid?


Yeah, nah, thats just sounding like apologist bulls*** now. Something like Horizon Zero Dawn took 6 years to make, but that also included the time spent making their own engine for it, while Star Citizen is using a pre-existing engine(s). The Witcher 3 took 4 years to make. Both of those costing about half what Star Citizen is costing as well (well, half of the money raised by backers, god knows how much other money has gone into it from other sources).
trog
Posted 07:44pm 27/6/17
I suspect they are going to be trapped by the perfection fallacy. They will not want to release a game that is anything less than perfect, which is basically impossible, so they'll keep delaying release forever (a la DNF)
fpot
Posted 07:50pm 27/6/17
Holy s*** DNF was bad.
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